ADMS 3585 Chapter Notes - Chapter 7: Book Value, Transaction Cost, Cash Flow

• School: York University
• Department: Administrative Studies
• Course: ADMS 3585
• Professor: Professor Alcalde

Document Summary

Illustration 7. 1 p. 345 report cash/cash equivalent summary of cash related items p. 345. If there is condition, record (cid:862)contract asset(cid:863) rather than (cid:862)ar(cid:863: difficult to evaluate fair value as (cid:862)exchange amount(cid:863) different than fv, also difficult because, discounts. If pay after, use (cid:862)sales discounts forfeited account(cid:863: no contra acct since recognized at discount price, gross method record full amount, sales recognized after payment, requires sales discount acct & allowance for sales discount. Illustration 7-3 p. 348-349: sales returns & allowances, use estimates for discounts & report on fs (avoid overstatement, ex. Illustration 7-4 p. 351: allowance method, report uncollectibles as (cid:862)allowance for doubtful accounts(cid:863, p. 352 entry to allowance if previous balance exist. Debt expense: mix of procedures, estimates bad debt expense at end of every month based on % of sales reported, resulting (cid:862)percentage of sales app(cid:396)oa(cid:272)h(cid:863) Illustration 7-6 p. 354: direct write off method.